SENATOR PENNY WONG, SENATOR FOR SOUTH AUSTRALIA: I think there are two things that are very clearly the case after this press conference. The first is that we have a chaotic, dysfunctional and divided Government. We have a Prime Minister who has lied and a Prime Minister who has been prepared to play a multibillion dollar defence contract for a vote. We have a Prime Minister who has lied and a Prime Minister who has been prepared to play a multibillion dollar defence contract for a vote in the ballot. It is an extraordinary thing. What has been clear from what Senator Edwards said yesterday and confirmed today is that the Prime Minister told him that there would be a competitive, open tender for the submarines which wasn't true.
 
Now, what we have are weasel words from the Defence Minister and the Prime Minister which are completely at odds with the commitment the Prime Minister made to Sean Edwards. Remember, the context of this is one of the most important defence procurements in the nation's history. The most amount of money a Government will ever spend on a defence procurement is being played as part of the Liberal Party's leadership division. Played for a vote in the Liberal Party. Quite an extraordinary set of circumstances. Quite an extraordinary set of actions from the Prime Minister. I will hand over to Stephen now.
 
SENATOR STEPHEN CONROY, SHADOW MINISTER FOR DEFENCE: This is the defence procurement policy manual. I invite all of you to look through it and try and find where you can see any mention of a competitive evaluation process. It doesn't exist in here. It doesn't exist inside the department of defence. It doesn't exist anywhere in the defence industry knowledge. What you have is a complete tossing away of their own manual, their own processes. This shambles has to stop. What the Prime Minister should be announcing today is a proper, competitive tender process with a funded portion that allows the bidders to bid against a set criteria. No company that wants to bid to build our submarines even knows what the criteria they are bidding against is. This is not something you can go the Germans have a submarine, the Swedes have a submarine, the French have a submarine or even the Japanese have a submarine. You have to identify what strategic capability, what are its technology requirements. What are its defence capability requirements. You must specify them. Companies need to know to bid against it.
 
But as Penny has said, you have a Prime Minister that simply is trying to buy a vote and buy time. He sends his defence minister down to Adelaide, who couldn't even explain to a press conference what this evaluation process consisted of. There is a reason for that, it doesn't exist. They are making it up on the run. They are making it up as they go. It is time they came clean. It is time they admit they have been trying to break their promise on building submarines in Adelaide. The Prime Minister, as you have all been reading in the last few days, has done a deal with Prime Minister Abe, to build them in Japan and now this shambles has to end.
 
This is the most lethal defence asset Australia will have in its military arsenal. We can't afford to make mistakes. We have to have a proper process and we have got to start with a competitive process, with a funded capability that allows the companies to put in proper bids against proper criteria. That is what we need to get this right. We can't let the politics of saving the Prime Ministers job be put ahead of the national security interests of this country. I might hand over to Mark.
 
MARK BUTLER, FEDERAL MEMBER FOR PORT ADELAIDE: Thanks Penny and Stephen. For 30 years, the ship building and submarine building capacity at Port Adelaide has been supported by Federal Liberal and Labor Governments as an absolutely central part of our defence infrastructure. For 30 years, it has been an increasingly important part of the economy of SA and for the people of Port Adelaide whom I represent the particularly. At a time when the car industry is shutting down, in significant part because of decisions taken by this Government, the future of the ship building capacity down at Port Adelaide are utterly central to the economic future of SA.
 
That is why the people of Port Adelaide, the people of SA, more broadly, are just driven to distraction by these word games, by the future of the most important part of defence capacity building in Australia being used to buy votes in a leadership spill in the Liberal Party. It is really driving people beyond distraction. People aren't interested in the weasel words being thrown around by Senator Edwards, by the Defence Minister and by the Prime Minister. All the people of SA want to know is will the Prime Minister stick to his promise to build 12 new submarines in Port Adelaide? That is what people want to know.
 
JOURNALIST: Can you explain in more detail exactly how you think the process should work, including should anyone who wants to bid be able to bid, should the capability requirements be given to them, should they even be made public?
 
CONROY: What we need is a funded project definition study. That involves the Government giving money to the companies that are able to build this. There aren't that many. France, Sweden, Germany and Japan. This is not about Japan not being in it and the ASC if they want to bid or partner with one of those companies. You start a process where you have criteria, criteria they can bid against and that is part of that funded project definition. Secondly, I would take the DMO out of the equation. Set up a separate entity to manage this process. Then we need an evaluation of those bids that have come in. That is the proper process. Not the Prime Ministers off in Japan and shakes hands and we go back and start bagging the ASC and saying the workers can't do it and we see stories of the cost. The Germans have put in a $20 billion submission saying we can build 12 for $20 billion in Australia. They should be part of this process. We are seeing the Prime Minister refusing to back out of his agreement with the Japanese Prime Minister. He has lied before the election. He has been lying since the election and now we have to get this on the table and a proper process.
 
JOURNALIST: What is to say what the Government is talking about, what is to say that won't possibly include what you're calling for?
 
CONROY: Here is the precurement manual. No-one in the department of defence has a clue what they are talking about. No-one in the industry has a clue what they are talking about and under questioning this morning in Adelaide, the Minister didn't have a clue what he was talking about. This is a national defence asset. This is our most lethal capability. We cannot afford to make this process a shambles. We will end up with a major debacle at the end of this process.
 
WONG: Can I just make a comment on that. It is important to note that what Sean Edwards said the Prime Minister told him is not a competitive evaluation process. Sean Edwards has clearly said on a number of occasions that the Prime Minister told him there would be a competitive open tender. That is not what is on the table. What the Prime Minister told him in the conversation where he was seeking his vote was something that is not true.
 
JOURNALIST: What is your definition of a competitive open tender as opposed to
 
WONG: As the shadow defence minister has outlined.
 
CONROY: So anyone can bid for it. So the Chinese might be able to say we want to build you a submarine? There are three international companies that can do this. If Brendon Nicholson Inc decided to put in a bid, you can treat that with the merit it deserves and that is no reflection on Brendan. There are three international companies plus Japan who have never put in for one like this because they have never exported a submarine. Reports this morning are saying that Japan will not even provide the most important information to Australia's defence white paper preparation. They are withholding key information. If they want to put that information into that process, then we welcome that. It could be that Japan is the best submarine for the best value. Unless we have a proper process, so when you use the word open, the Government will say we can't have the Chinese bidding. There is three or four countries that can do this and it is up to the national security interests of this country to get it right. You can't just say we are going to it have an evaluation process when it is not in here and nobody knows what that means.
 
JOURNALIST: I know you have that there but isn't it that this project is so big, so new that there is no rule book on this. It could be there are various stages and we dont know about that - the open tender could happen later on, you say -There has been a process in train. You say that the Government is making it up as they go along, isn't everyone?
 
CONROY: No, there was a process under Labor. $200 million had been committed as part of this process to get it right. It didn't go as fast as everybody wanted, we acknowledge that. DMO have suddenly been sent around the world as a cover because the Prime Minister made a commitment to the Japanese Prime Minister and they are trying to pretend they are going to go through a fair dinkum process now. They need to have a proper funded competitive tender which has a funded portion against set criterias so people know what they are bidding against. That doesn't mean you hand out sensitive national security documents as part of the process.
 
You need a proper secure process. Don't let them play the word game of open. That is how David Johnston played the game. Let's not play games about the word open. They know what this requires. They were engaged in that but we are nearly 18 months into the life of this Government and they are just announcing a new process. Joe Hockey said in December, six weeks ago, he said there is not time for a proper process. And Kevin Andrews says we won't be rushed, we will start a new process. This Government are shambolic when it comes to national security and they are making a farce of this process.
 
JOURNALIST: How far do you believe the Government has gone down the track with the Japanese? Do you believe we have a formal arrangement?
 
CONROY: Well the Prime Minister could tell us. We have had leaks from a discussion between the French President when he was here at G20 with the Prime Minister. It has leaked out that Mr Abbott told the French President not to bother bidding, Japan were getting it. That is what the French have been told. We have leaks coming out of the meeting pre-G20 at Myanmar where President Obama, Prime Minister Abe and Prime Minister Abbott held a discussion about putting Americans weapons systems into the Japanese subs. So when you say is there a formal decision of the cabinet to go down this path? No there is not yet. There is a lot of information in the public domain that suggests that the Prime Minister has done another captain's pick. He has decided we want to bring Japan into the fold and it doesn't matter what processes get trashed or what work has been done or how much money has been spent. It is time for him to let go. If he has listened to his backbench as he said he has done, and hes going to change, let this captain's pick go as well.